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Is your packaged current account working for you?

The best account can save you more than £100 a year

White piggy bank being emptied of coins onto a grass mound

The latest Which? research reveals the packaged current accounts that can save you more than £100 a year and the ones that’ll cost you extra just for the privilege of having one.

With more than nine million customers in the UK, packaged current accounts are well and truly here to stay. These accounts typically package up a range of benefits such as travel and mobile phone insurance, car breakdown cover and card protection at a monthly cost, in one account. 

But Which? Money has found a big difference in the value of the benefits offered by each account, with some accounts such as the Select account from NatWest/RBS costing £30 more than buying the key benefits separately. 

Fortunately we found the opposite true with the best accounts on the market. For example, our research found if you used the key benefits on offer from Nationwide’s Flexplus account you could save around 55% on the cost of buying the benefits as standalone products.  

Packaged accounts can be expensive costing up to £300 a year with the most expensive account, so making sure you make the most of the benefits on offer and not double up on cover is key. However, in a survey of Which? members more than a third of those with a packaged account already paid for one or more of the benefits included in their account as a standalone product, essentially paying twice for cover. 

Packaged current accounts: Which are the best and worst?

Natiowide’s Flexplus account comes out a clear winner, offering very comprehensive levels of cover for both travel insurance and car breakdown cover – at just under half the price of buying these benefits as standalone products (£120 instead of £269). The account also offers up to 3% interest on balances of up to £2,500 and mobile phone insurance.

Halifax’s Ultimate Reward and Barclays Travel Pack Plus both came out second and third in our table (See below), offering Worldwide and USA annual travel insurance for a family including winter sports and car breakdown offered by the AA and RAC respectively. Our assessment of each account shows that the annual cost of the account works out significantly cheaper than buying the equivalent benefits as standalone products, making accounts good value. 

The NatWest/RBS Select Silver accounts came out bottom of the table offering European annual travel insurance and mobile phone insurance, but at an annual cost that exceeds the standalone value of these two key benefits by £30. 

The Lloyds Bank/TSB/Bank of Scotland Premier account was one of the other accounts to come out in our analysis costing significantly more over a year than the standalone cost of the key benefits we assessed (travel, mobile phone insurance and breakdown cover). However this account also offers home emergency cover, free airport lounge access, plus credit interest of up to 2%, though its worth noting you can get credit interest from any Lloyds Bank, Bank of Scotland Vantage account or TSB Enhance account without having to pay a monthly fee. 

Packaged accounts compared

The table shows 15 packaged current accounts from 12 banks, along with the key benefits that they offer. As travel insurance, breakdown cover and mobile phone insurance are the key benefits across most accounts that are likely to be of value, we’ve included the cost of the cheapest equivalent cover for a Which? Best Rate travel insurance for a 65 year old, breakdown cover from Green Flag and standalone mobile phone insurance from My GadgetBuddy.com for a £16GB iPhone 5 costing £529. 

The table is ranked by the account score which is weighted by annual cost (20%); the level of cover offered by travel insurance (30%); car breakdown cover (30%); interest free overdraft (10%); and mobile phone insurance (10%).

Fee-charging bank accounts
Provider Annual cost of account Travel insurance Standard upper age for travel insurance Car breakdown cover Value of key benefits a Interest-free overdraft limit Mobile phone cover limit Account score
Nationwide Flexplus b £120 WF* 74 R, H, N, A, EU £414 £100 £1,000 83%
Halifax Ultimate Rewards c £120 WF* 70 R, H £258 £300 £2,000 70%
Barclays Travel Plus Pack £186 WF* 79 R, H, N, A, EU £331 £200 n/a 68%
Barclays Travel Pack £126 WF 79 R, H, N, EU £267 £200 n/a 68%
Royal Bank of Scotland Select Platinum £192 WF* 69 R, H, N, A £318 £250 RP 67%
NatWest Reward Platinum £216 WF* 69 R, H, N, A £318d £250 RP 65%
Lloyds Bank, TSB, Bank of Scotland Platinum £204 WF* 79 R, H, N £278 £300 £2,000 63%
Halifax Ultimate Rewards £180 WF* 70 R, H £258 £300 £2,000 62%
First Direct First Directory e £180 WF* 69 R, H, N £276 See f £600 59%
Lloyds Bank, Bank of Scotland Silver £119 EF* 64 R £200 £50 £2,000 59%
TSB Silver £119 EC 64 R £170 £50 £2,000 55%
Clydesdale Bank/Yorkshire Bank Signature £162 WF* 74 R, H £258 £0 £1,000 55%
Royal Bank of Scotland Select Silver £120 ES 69 n/a £105 £10 n/a 43%
NatWest Reward Silver £144 ES 69 n/a £105d £10 n/a 39%

Table notes (information correct at October 2016)

Key: Travel insuranceEC = Europe annual inc UK (couple), EF = Europe annual (family), EF* = Europe annual (family) + winter sports, ES = Europe inc. UK (individual), WF = Worldwide annual inc USA (family), WF* = Worldwide annual inc USA (family) + winter sports

Key: Car breakdown coverR = Roadside assistance, H = Home start, N = Nationwide recovery, A = Alternative travel or accommodation, EU = European assistance

Key: Mobile phone cover – RP = Replacement phone

a The combined cost of a Best Rate travel insurance policy, breakdown cover from WRP AA and mobile phone insurance policy from Insure2Go (see below for further details) 

b 3% interest paid on credit balances up to £2,500.

c Minimum monthly funding of £750 required

d Also offers 3% in rewards on selected household bills paid by direct debit. This equates to £123 cashback based on average monthly bills of £32 (water), £89 (energy), £44 (mobile phone/data), £35 (landline/broadband), £19 (TV package), and £124 (council tax)

e Minimum monthly funding of £1,000 required

f First Direct offers £250 interest-free overdraft limit on its standard account, so we’ve not awarded additional points

Should I pay for one? 

The best packaged accounts on the market can offer decent value and save you money, but only if you make the most of the benefits they offer. If you don’t use use the insurance policies and added perks you’ll be wasting money. Visit our online guide for more information about finding the best bank account

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